Stubbornly high Inflation is casting a pall over the holiday season — two thirds of Americans will watch their wallets when shopping and millions will spend less on booze, groceries, and gifts this year, a series of studies show.
Polling by Morning Consult shows that 64 percent of adults will be more careful when shopping for gifts this year, and 82 percent will stock up in Black Friday sales and scour for other discounts.
The survey of 2,210 adults earlier this month also found that 44 percent would cut back on travel this holiday season while also spending less on alcohol (41 percent), gifts (32 percent) partying (26 percent) and groceries (24 percent).
Consumer prices rose by a higher-than-expected 8.3 percent in the year to August, the Labor Department said on Tuesday. Though gas prices have fallen from record highs, Americans are spending ever-more on rent and food.
Of particular concern are soaring prices at grocery stores, which have jumped 13.5 percent this past year, pushing up costs of pantry basics like flour, eggs, butter and the classic Thanksgiving dish — turkey.
Inflation has escalated families' grocery bills, rents and utility costs, among many other expenses, inflicting hardships on households and deepening gloom about the economy despite strong job growth and unemployment near historic lows.
Though Joe Biden says the country is 'making progress' against inflation, soaring prices and the economy are top priorities for voters and are likely to hurt the president's Democratic Party in the upcoming midterms.
Other surveys reach similar findings. A poll of 14,400 U.S. consumers by Shopkick, a shopping app, found that more than a third of respondents were cutting back the number of people they were buying gifts for this year to save cash.
Brittany Billings, the group's marketing executive, said shoppers were still struggling with soaring prices while 'fears around a potential recession linger'. Stores have to offer 'deals and savings early' to get business, she added.
A study by 4Over of more than 1,000 adults found that 59 percent were stressed out about buying gifts this year due to inflation, and nearly three quarters thought prices were increasing into the holiday season.
The festive spirit may wain for the 43 percent of respondents who cut back on general spending, as they limit everything from movies to dining out, concerts, travel and even haircuts and beauty appointments.
Meanwhile, the number of online orders is forecast to drop 5 percent compared with the 2021 holiday season, according to data from Salesforce, a software firm, as consumer budgets are pinched by inflation.
Higher costs of production — including for labor and transportation — will outpace retailers' ability to pass costs on to customers, putting 10 percent of profits at risk for retailers, added the group's study.
Rob Garf, a Salesforce vice president, said retailers were 'feeling the squeeze from unprecedented margin pressure due to increased labor wages, fuel prices and inventory-carry costs' and had to scale up and automate their businesses.
